FBT

A/c entries 864 views 3 replies

Shrilakshmi Raj

81 Points Joined January 2008

For FBT we make quarterly payments under the head Advance FBT Assessment Year( for respective Assessment Years).

At the time of Year end – we make a provision for FBT .

My assumption is that provision for FBT will get nullified with Advance FBT (for respective Assessment Years) only when assessment is closed for that year. Till then, these ledger accounts will remain as it is. (Will remain as such in opening balance). Is my view correct?

Replies (3)

sagar

CA Final

379 Points Joined February 2008

There are two ways of accounting FBT.

1) Advance payment of FBT will be shown as Advance in Balance Sheet for an assessment year. At the year end while making provision of Fbt Keep it as liability. The " Advance Fbt" and "Provision for FBT" will be in accounts till assessment order comes.

2) Pay FBT for a particular year quarterly and show as an expenses in P& L A/c. at the year end Make Provision of FBT by debiting P&L A/c. When Final payment is due on assessment order or self assessment. Debit Provision for FBt and Credit bank account

praveen

Chartered Accountant

6971 Points Joined September 2007

Originally posted by :sagar
"	There are two ways of accounting FBT. 1) Advance payment of FBT will be shown as Advance in Balance Sheet for an assessment year. At the year end while making provision of Fbt Keep it as liability. The " Advance Fbt" and "Provision for FBT" will be in accounts till assessment order comes. 2) Pay FBT for a particular year quarterly and show as an expenses in P& L A/c. at the year end Make Provision of FBT by debiting P&L A/c. When Final payment is due on assessment order or self assessment. Debit Provision for FBt and Credit bank account	"